Realtors expect home values to fall by more than 20 percent on the west bank as a result of the Avondale Shipyard closure, and most believe that home prices across the metropolitan area will also be affected, according to a study released Monday by the Avondale Shipyard Research Project at local universities. Steve Striffler, professor of anthropology and geography at University of New Orleans, said the research consortium didn't plan on investigating home values as its first project, but in their initial interviews at the Avondale Shipyard, workers immediately started expressing concerns about housing.

Chris Granger/The Times-PicayuneA study released Monday suggests that housing prices on the west bank could fall 20 percent as a result of the closure of Avondale Shipyard. The yard is expected to close in 2013.

"The first thing they started talking about was fear of not being able to make their payments on houses," said Striffler, who is working with other researchers from UNO, Loyola University, Tulane University and Southern University of New Orleans to assess the economic and social consequences of closure of the Avondale Shipyard.

Last year, Northrup Grumman announced it would close the 70-year-old west bank shipyard, then the state's largest private employer, in 2013. Workers are being let go as work on the yard's final ship is completed. The shipyard provided stable middle-class jobs with average salaries of $65,000 a year.

Workers expressed concerns of losing their homes to foreclosure if they couldn't find jobs with wages that would allow them to make their mortgage payments. Workers were also concerned about their ability to sell their homes in a declining housing market if they needed to move.

As a result, researchers decided to survey 63 Realtors randomly selected from the greater New Orleans region about how the closure would affect the real estate market on the west bank and across the region.

Some 90 percent of Realtors predicted that prices would fall by at least 20 percent near the shipyard.

Another 91 percent said they believed the closure of Avondale would have a negative impact on the New Orleans area housing market as a whole, with 28 percent of Realtors surveyed predicting a drop in housing prices of more than 20 percent across the region.

"I think we were surprised that almost uniformly, Realtors not only saw this as a problem in the area right around Avondale, but more broadly," Striffler said.

Wade Ragas, professor emeritus of finance at UNO who studies home prices for the New Orleans Metropolitan Association of Realtors, said it's difficult to know what to make of the study, because there are too many unknowns. The closure of the shipyard will certainly cause an increase in foreclosures, but it's hard to assess the real impact on the housing market, because it's not known how many workers live on the West Bank, how many are upriver of the plant, and how many are north of Lake Pontchartrain in places like western St. Tammany Parish, Washington Parish and Tangipahoa Parish.

There's also no reason to think that all of the Avondale workers will suddenly put their homes on the market, because unless they're prepared to move to the Dakotas to use their welding skills on shale gas development, there aren't necessarily better job opportunities in other places. Ragas believes it's more likely that workers will try out temporary jobs in other locations, leave their families back in the New Orleans area, and come back to visit every other weekend. He suspects they'll leave only when they believe they have secure jobs in a new place.

Ragas believes the effects will play out slowly. "I've had a hard time connecting the dots as to how soon it has an effect on the housing market, and whether they put their house up for sale. It may be (bad for the housing market) over time, but near term, I don't think it's that dreadful," he said. "I don't know why they would all suddenly put their houses up for sale. If they're going to move everybody, it's not until they're sure that they've got a job that's going to last."

Striffler said his team had some of the same questions. No time frame was attached to the Realtors' dire predictions, since no one knows how quickly the jobs will be eliminated.

Researchers also don't know how many workers may seek to move or how quickly. Some workers seem to likely to find other employment for their skills. Other employees had jobs that were so specialized that they might have trouble transferring their skills, and may need to leave the area. Still others have deep roots in the region and don't want to contemplate leaving, so they seem most concerned about making their mortgage payments, Striffler said.

Rebecca Mowbray can be reached at rmowbray@timespicayune.com or 504.826.3417.